Personal Recognition and Incentives

While you may hear the words used interchangeably, incentive and recognition have very different meanings. Both reward and motivate performance. However, they do so quite differently. An incentive drives performance like a contract. An if/then clause establishes expected performance for a promised reward: "Do this, get that." Personal recognition fuels the inner drive, igniting the spark of self-motivation into a fully-energized flame of continuing accomplishment.
Incentives
Incentives reward results with external benefits such as pay, promotions, benefits or office space. For example, you offer people a percentage of the money saved by a suggestion they’ve made. Or, when your salespeople reach a certain dollar goal, you reward them with a Caribbean cruise. These “extrinsic” incentives motivate people to work a little harder than usual. Because incentives reward performance or results, they are usually self-funding. No results — no rewards. So, incentives are often the most cost-effective, results-effective and risk-free form of compensation.

Personal recognition
While people do enjoy extra money and added perks, many receive greater satisfaction from knowing someone valued their contributions. This “intrinsic” motivation drives people to perform for an internal sense of accomplishment. Many a manager or CEO may say, “Well, my people should work hard. That’s what they’re paid for." But how will people know they’re doing a good job if we don’t tell them? Personal recognition lets them know.

Your well-constructed personal recognition program will help you…
• Meet people’s needs for achievement and personal recognition
• Translate company values into specific work habits
• Focus efforts on achieving specific goals
• Achieve profitability and growth
• Create a culture where people really want to do their best
• Tell people what’s really important to the organization
• Improve individual attitudes
• Boost overall morale
• Produce role models for future programs
• Reward achievement with a sense of accomplishment and closure
• Foster healthy competition between individuals and teams •
Create loyal, committed employees

As an after-the-fact display of appreciation for a contribution, personal recognition often surprises the recipient (who performed well for reasons other than receiving personal recognition). By addressing the individual’s need for self-esteem and belonging, personal recognition bestows strong intrinsic rewards. Where incentives emphasize specific behavior leading to desired results, personal recognition expresses feelings of pride and camaraderie, in both the person giving the personal recognition and the person receiving it. Personal recognition has lasting, residual effects on the rest of the organization. The material reward, often minimal in extrinsic value, becomes an important symbol of management’s sincerity and commitment to corporate values and culture.

In this manner, personal recognition significantly impacts morale and performance. Most people want to do a good job and are willing to work hard. But, they need direction in what they do and feedback on how they’re doing it. Personal recognition provides feedback while building self-esteem and inner drive. When people routinely receive personal recognition for their efforts, they begin to trust in the system, knowing that their hard work will be rewarded. They become more committed to their organization. Incentives, when used in tandem with personal recognition, can ignite a synergy that empowers the individual and the organization. In public and private, personal recognition works for you.

Highly visible, public personal recognition calls attention to a person’s achievement in a group setting — at a meeting or conference, in a newsletter or over the intercom. More intimate, private personal recognition takes place one-on-one, for example, between the manager and employee — a thank-you note, an e-mail, a praising chat in your office. Competitive extroverts thrive more on public personal recognition, while quiet, introverts might prefer a private, informal personal recognition. Be sensitive to individuals’ personal recognition differences. Take time to get to know them informally so you can meet their needs. If you’re not sure, ask — either in private conversation or with a questionnaire.

What does personal recognition look like? Personal recognition has many faces. It can be a social acknowledgment for a job done well — a pat on the back, a verbal thank you, praise. Such positive personal recognition creates positive feelings. Reward people when they demonstrate performance above what’s expected when an employee covers for a sick co-worker or when a team completes a project ahead of schedule.

Practice praise repeatedly with repeat performers. Like personal recognition, praise motivates people to reach new levels of achievement. Material rewards include tangible objects like certificates, money, benefits, travel, entertainment or personal service awards. Tangible rewards back up social acknowledgments. However, using material rewards too frequently or inappropriately can make people feel manipulated. Conversely, when you use social acknowledgment exclusively, and never with a tangible reward, people may feel like your praise is empty and meaningless. The most successful personal recognition programs recognize people with both praise and material rewards.

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